The Legal 500

If the UK economy is to attract and retain talented and experienced workers from overseas, there has never been a more urgent time to act. Current Home Office processing delays and predicted changes to the Immigration Rules mean that the government is closing the door on overseas nationals with skills valued by UK businesses.

Immigration issues frequently make the front page of the tabloids, with asylum seekers and 'economic migrants' hogging the headlines. But business-led immigration rarely takes centre stage. Despite this, British business benefits day-in and day-out from the skills and experience brought to the UK by overseas nationals, and the government has repeatedly stated its commitment to attracting skilled and talented workers from overseas.

However, the last 15 months have seen an appalling deterioration in service levels at the Immigration and Nationality Directorate of the Home Office, which has impacted upon just the highly skilled workers that the government has been seeking to attract.

A recent review of the Highly Skilled Migrant Programme (HSMP) is likely to make recommendations aimed at reversing this service downturn. But the review is also likely to recommend a qualified retreat from the policy of attracting skilled workers and result in a narrowing of options for businesses recruiting or working in partnership with overseas nationals.

Background
With the launch of the HSMP as a pilot scheme in January 2002, the government signalled its intent to attract educated and experienced overseas nationals to the UK. For the first time in decades, the closed-door immigration policy was relaxed to allow entry to the UK for overseas nationals without the need for either a financial investment in business or a firm job offer. The HSMP attracted over a thousand successful applicants in its first year of operation.

In January 2003 the government changed the qualification criteria in the hope of attracting over 10,000 successful applicants in the subsequent 12 months, and promoted the HSMP overseas as a 'flagship' immigration category. The pilot scheme was declared a success and the HSMP was formally incorporated into the UK Immigration Rules in April 2003.

Yet another change to the qualifying criteria in October 2003 further increased the number of potential applicants. The steady but increasing stream of applications rapidly turned into a flood that swamped the small processing teams and now threatens the success of the whole scheme.

In October 2003 (just before the latest change to criteria) applications were completed, on average, in just three to five days from submission. In December 2004 average processing times stood at over six months, with delays increasing week on week.

Reasons for and effects of the delays
These delays have, in part, been caused by the substantial increase in applications. In August 2004 the Home Office received over 2000 applications - far more than the small team of staff are able to process. It is not, however, simply the volume of applications that has caused the difficulty; problems with recruitment and training of staff in Sheffield (the Home Office base for the HSMP) have also led to delays spiraling out of control.

Current problems also reflect the current tightening of controls in relation to the scheme. Caseworkers are asking for more and more documentation in support of an application, which has increased the time taken to consider each application. Applicants worried about a refusal for submitting too little documentation (currently around 30% of all applications are refused) are submitting reams of papers in the hope that the requested evidence will be weeded out by the caseworker, further increasing the time spent on each application.

Not surprisingly, the current poor service standard has meant that the scheme is far less attractive to overseas nationals than it was in the early days. Although hard figures are not available, it is likely to be the most senior and talented business people who feel that the delay and frustration involved in such a long application process is uneconomic, and who will either look for alternative routes to the UK (perhaps as a sponsored employee under the work permit scheme) or simply decide to pursue business plans elsewhere in the world. The scheme is perhaps now the refuge of the more determined or more desperate applicants.

In light of these developments the Home Office announced in autumn 2003 a top-to-bottom review of the HSMP. No official intention to withdraw or restrict the scheme has been announced, but comments such as 'we are receiving the wrong kind of applications' and 'it isn't going to get any easier' have signalled the likely direction of any recommendations.

How the current HSMP works
Unlike other immigration categories, the HSMP allows applicants to come to the UK to work on an employed or self-employed basis, or even a combination of the two. Applicants who do not already have work arranged may still qualify, provided they can show reasonable prospects of finding work in the UK.

This flexible approach, allowing consultancy, freelance and full employment, or even establishing a new business, has been welcomed with open arms by many UK businesses frustrated by the constraints of the work permit scheme, which only permits overseas nationals to work as a full-time employee. This flexibility reflects current varied work practices, and is far more attractive to a senior business person than tied employment with a work permit. The loss of this flexibility, either by continued poor processing times or a tightening of the criteria for eligibility, would be a great loss.

Although present processing times remain a deterrent, candidates who meet the current criteria for the HSMP should be encouraged to apply urgently before any changes cut off this route and narrow future work options in the UK. Applications received before the implementation of any changes will be considered under the current regime, which is likely to be wider and more favorable than any post-review scheme.

Applicants within the UK
Potential applicants may already live in the UK in some other immigration category, such as work permit holder. Employers faced with making work permit holders redundant or losing them to competitors often negotiate a move for the workers to the HSMP to allow them to look for alternative work free from immigration barriers, or even to continue working for the same employer under more flexible working arrangements, such as a part-time consultancy agreement. Workers already in the UK often switch to the HSMP of their own volition (perhaps without notifying their current employer) to gain the same freedoms.

The HSMP is particularly attractive to overseas nationals already living in the UK. Like most other employment-related immigration categories, the HSMP will usually mean that overseas nationals will be eligible to apply for indefinite leave to remain in the UK (sometimes known as permanent residency or settled status) once they have been living in the UK for four years. However, unlike any other immigration category, HSMP workers can count time spent in the UK before approval of their HSMP application - for example as work permit holders. Thus a switch into this status from within the UK does not restart the clock for indefinite leave to remain.

Applicants overseas
Alternatively, applications come from foreign nationals who wish to come to the UK for the first time to look for or accept new work. Under the HSMP it is not necessary to show that there is an existing job offer which has been accepted. This rule ended the Catch-22 situation faced by many overseas nationals who were not able to find work in the UK from overseas, but were not able to come to the UK until they had found work.

Points-based system
Unlike almost all other immigration categories, the HSMP operates on a points-based system - applicants must score a minimum of 65 points to be eligible for the scheme.

Points are available over five main scoring areas, with additional points available for qualified general practitioners (to reflect the shortage of doctors in the UK). The five scoring areas are based on education, work experience, previous earnings from work, achievements in the applicant's chosen career and even qualifications or work experience of the applicant's spouse or unmarried partner.

Since October 2003 the scheme has been split into two sections, with applications from candidates aged 27 and under being considered under a more generous scoring criteria in some areas.

Education
For both age sections of the scheme, in the area of education applicants can score 30 points for a PhD, 25 for a Master's degree or 15 for a Bachelor's degree (only the highest qualification will score). Points are also available for vocational and professional qualifications if applicants can show they are equivalent to one of the three mentioned UK academic qualifications.

Work experience
In the area of work experience, candidates aged 28 or over can score up to 50 points if they have 10 years' graduate level work experience including five years at a senior level. A lower score of 35 points is available for applicants who have five years' graduate level work experience, including two years at a senior level. Alternatively, for candidates who do not have senior level work experience, a maximum of 25 points are available if they have five years' graduate-level work experience or a PhD and three years' graduate-level work experience.

For candidates aged 27 and under, a more generous scoring regime is available in relation to work experience to reflect the candidates' youth and relative inexperience. To score 50 points young applicants need only show four years' full-time, graduate-level work experience, including just one year at a senior level or in a specialist role. Thirty-five points are available for four years' work experience which is graduate-level, but not senior or specialist, and 25 points are available for just two years' graduate-level work experience.

Previous earnings from work
The points available for earnings are classed in income bands, with 25 points available for income band one, 35 points for income band two and 50 points for income band three. The income bands are then split into five country codes with a higher income needed to reach each income band in an affluent western country compared with a developing country.

For example, to score 25 points (income band one) on the basis of earnings received in the USA (classed as country code A) a candidate aged 28 or over will need to show annual earnings from employment of £40,000. In comparison, if the same candidate had been working in Russia (country code C) immediately before making the application, they would need to show annual income from employment of £12,500 to score at the same level. For countries such as Ghana (country code E) they would need to show just £3,500.

Applicants for the younger scheme can expect to earn points at lower salary thresholds. To use the same example of income band one, a candidate aged 27 or under who has been working in the USA must show income from employment of just £27,000 per annum to score 25 points, £12,500 per annum if coming from Russia, or just £2,350 if coming from Ghana.

Achievements in a chosen profession
For achievements in their chosen profession, candidates can score 15 points for significant achievement or 25 points for exceptional achievement, but again a more generous interpretation of what amounts to significant or exceptional will be applied to younger candidates.

A spouse or unmarried partner's qualifications and achievements
The final main scoring area relates not to the qualifications or achievements of applicants, but to those of their spouse or unmarried partner. If the spouse or partner has either degree-level education or is currently employed in a graduate-level job, then a further ten points are available - this applies equally across both age ranges of the scheme. Both partners to the relationship must be coming to live in the UK.

If the couple are not married it will be necessary to provide evidence that they have been living together in a marriage-type relationship (which can include same-sex relationships) for at least two years before making the application.

Bonus points for age
Finally, all applicants aged 27 and under automatically score a further five points just by virtue of their age.

Additional requirement
In addition to scoring the minimum of 65 points, applicants will also need to show that they intend to make the UK their main home and that they will have sufficient income (combined with existing savings if necessary) to support themselves and any family members in the UK without claiming public funds.

Comment
At a time when the UK is suffering from shortages of skilled and experienced workers in many areas of industry, any narrowing of the HSMP scheme must be regarded as detrimental to the UK economy. Equally, the Home Office must accept that the calibre of applicants will affect the estimated processing times of applications.

Consider the knock-on effects of a delayed response to an HSMP application from a business person in New York earning £100,000 a year - just the type of person the HSMP aims to attract. While their application remains in a queue in Sheffield awaiting consideration, they must remain outside the UK waiting for permission to enter under the HSMP. During this time they continue to work in their home country and the UK economy loses the tax on the income they would have earned in the UK had their application been approved, the increased company profit (and consequent tax) that their activities in the UK could have generated, and also their own personal spending power.

With processing times currently running at more than six months, many potentially valuable applicants will feel that the process is too lengthy and bureaucratic. The answer is not to increase the eligibility criteria to reduce the total number of applications received, but rather to recruit, train and retain sufficient staff at the Immigration and Nationality Directorate in Sheffield to keep pace with the volume of applications. In the meantime, the advice must be to submit any potential applications as soon as possible before post-review changes rule out any candidates.

Julia Jackson is an associate solicitor at Magrath & Co specialising in immigration and nationality law. She is a member of the Executive Committee of the Immigration Law Practitioners Association and a member of its Employment and Business Sub-Committee.

For more information please visit www.magrath.co.uk.